Centers for Medicare & Medicaid Services
Department of Health & Human Services
P.O. Box 8013
Baltimore, MD 21244-8013
March 7, 2014
Submitted Electronically: http://regulations.gov
To Whom It May Concern:
The Center for Medicare Advocacy (Center) is pleased to provide the Centers for Medicare & Medicaid Services (CMS) comments on the Notice of Proposed Rule Making (NPRM) CMS- 4159-P published in the Federal Register on January 10, 2014 (79 Fed. Reg.1918). The Center, founded in 1986, is a national, non-partisan education and advocacy organization that works to ensure fair access to Medicare and to quality healthcare. The staff of the Center works to educate older people and those with disabilities to understand and secure fair access to necessary health care services. The Center’s health policy advocacy is based on its experience of assisting thousands of individuals and their families with Medicare coverage and appeal issues. Additionally, the Center provides beneficiaries with class action representation to address broad patterns and practices that deny access to necessary services under the Medicare program.
Introduction to Comments
In many respects, the proposed CY 2015 Part C and D rule reflects CMS’ belief that enhanced oversight of prescription drug plans (PDPs) and Medicare Advantage plans (MA plans) is needed to improve the delivery of Medicare benefits. We at the Center applaud this approach and strongly support many provisions in the proposed rule. There are, nonetheless, provisions with which we take issue. We are very troubled, for example, by proposed changes to redefine protected drug classes and assert that this provision should not be implemented. We reject sweeping calls by some stakeholders to rescind the entire rule.
III. Provisions of the Proposed Regulations
A. Clarifying Various Program Participation Requirements
Overall, we express our support for proposed improvements in plan oversight.
2. Two-Year Limitation on Submitting a New Bid in an Area Where an MA Plan has been Required to Terminate a Low-Enrollment MA Plan (§422.504(a)(19))
CMS proposes prohibiting MA plan sponsors from submitting bids for new plans of the same type in regions where the plan was not renewed due to low enrollment. We support this rule as a means of discouraging plan sponsors from resubmitting bids for plans not well suited to beneficiaries’ needs.
3. Authority to Impose Intermediate Sanctions and Civil Money Penalties (§422.752, §423.752, §422.760 and §423.760)
We support new proposed sanctioning authority for marketing and enrollment violations.
4. Contract Termination Notification Requirements and Contract Termination Basis (§422.510 and §423.509)
Given the array of procedural protections available to plans, we support the increased authority of CMS to terminate non-performing contracts and support the proposal to shorten the notice period.
6. Changes to Audit and Inspection Authority (§422.503(d)(2) and §423.504(d)(2))
In this section, CMS details the criteria by which it determines which Part C and Part D plan sponsors are audited each year. CMS also acknowledges that limited resources allow the agency to perform annual audits on only 10% of plan sponsors, or 30 of 300 Part D and MA sponsors. We strongly agree that more regular auditing of plan sponsors is needed. We support efforts to increase oversight of plan sponsors and the increased ability of CMS to conduct audits. While we generally support CMS’ goal to require plans to hire an independent auditor, we are concerned about replacing CMS directed audits. The delegation of audits requires assurance that independent auditors will provide meaningful, truly independent, analysis. In addition, we urge members of Congress to make the necessary resources available to CMS so that the agency has the in-house capacity to perform audits on an appropriate scale.
7. Procedures for Imposing Intermediate Sanctions and Civil Monetary Penalties under Parts C and D (§422.756 and §423.756)
We support the expansion of the “test period” requirement to all intermediate sanctions. We also support the proposal that previously sanctioned benchmark Part D plans not be allowed to receive or process auto-enrollments for reassignments if so determined by CMS.
8. Timely Access to Mail Order Services (§423.120)
CMS acknowledges specific instances in which Medicare beneficiaries did not receive timely access to medications via mail-order pharmacies that are in part the result of increased demand. We agree with CMS that these delays could risk the health and well being of beneficiaries. As such, we support CMS’ proposed three to five day timeframe for delivering needed prescriptions. In response to CMS’ request for comment, we strongly support additional requirements to improve beneficiary notice related to mail-order prescriptions, specifically on contacting 1-800-MEDICARE and on how to obtain a prescription in the event of a delivery delay.
We continue to request that CMS establish remedies for individuals who make mistakes with respect to mail-order prescriptions, including returns. Additionally, we observe cases where a beneficiary’s medication is lost or stolen. CMS should develop clear and prompt processes for recourse in these situations.
9. Collections of Premiums and Cost Sharing (§ 423.294)
Cost Sharing: While we appreciate the need to enforce anti-kickback requirements, we have concerns about the proposal to impose an absolute prohibition on waiving cost sharing when a pharmacy is related to a Part D plan sponsor. CMS has stated that the current proposal is a response to reports of sponsors reducing or waiving cost sharing. To the extent that those reports raise concerns about unfair practices, we urge CMS to oversee more actively compliance with current rules rather than remove a valuable safety valve.
The current exception that allows a pharmacy to waive cost sharing in the face of evidence of a beneficiary’s financial need is already narrowly drawn. It should not be narrowed further. The current exception requires that the waiver is not advertised (through media outlets, telemarketing or otherwise), is not routine, and available only after a good faith determination that the individual is in financial need or after reasonable efforts to collect the cost sharing have failed.
Having this modest waiver as a safety valve is an important beneficiary protection. It can avoid unnecessary emergency room visits and reduce overall costs to Medicare.
The urgency of a waiver is not changed depending on the ownership of the pharmacy. Thus, it should not be necessary waiver rules depending on pharmacy ownership structure.
We note that CMS would permit a pharmacy affiliated with a plan sponsor to continue non-routine waivers of cost sharing for individuals in plans with sponsors other than the sponsor with which the pharmacy is affiliated. In theory, this policy would narrow the number of instances in which beneficiaries would be harmed because large chain pharmacies serve members of many Part D plans and the absolute prohibition would only apply to one of those sponsors.
We have serious concerns, however, that in practice all beneficiaries in all plans using such pharmacies will be denied important emergency protections. We fear that the most likely outcome of the new rule will be that pharmacies affiliated with a plan sponsor will give employees a blanket direction that they may not waive cost sharing under any circumstance. This fear is reinforced because the anti-kickback provisions at issue trigger criminal penalties. The risks if a pharmacist makes an error in determining whether an individual is in an affiliated plan are likely too serious for sponsor-affiliated pharmacies to give any discretion to their employees.
Congress intended that pharmacies have the option of a humanitarian response to unusual and urgent situations without fear of criminal charges. We believe that the proposed regulation unnecessarily undermines that purpose.
Premiums: Our concerns about waiving premiums are different. Over the course of implementation of Part D, we have seen repeated instances in which plan sponsors, because of poor computer programming, bad records, or other administrative errors, have failed to bill individuals for premiums due. These failures to bill have not been instances of plans trying to lure enrollees with discounts; rather, they have been simple acts of mismanagement, with the errors extending over long periods of time, frequently more than a year. When the errors were discovered, CMS has permitted– and in fact required –plans to send large bills for past due amounts to beneficiaries. As a result, many beneficiaries with limited incomes and very tight budgets found themselves facing large and unexpected payment demands. Moreover, beneficiary notices approved by CMS do not inform beneficiaries that they have any option other than to pay the full amount.
In reality, if beneficiaries claim financial hardship or simply fail to respond to the notices, CMS has required plans to write off some or all of the past due amounts. As a result of lack of notice about waiver, many beneficiaries, worried about bill collectors or fearing loss of benefits, simply pay despite severe financial hardship.
This policy is unfair to beneficiaries. The purpose of the anti-kickback provisions is to prevent plans from getting unfair market advantage. It is not to protect plan sponsors from the consequences of their own mismanagement, particularly on the backs of beneficiaries, many with limited incomes, who are unprepared to handle large unexpected bills. We ask that CMS set clear limits on how far back plans can go to collect premiums that they failed to bill through mismanagement. Further, we ask that notices to beneficiaries in such cases always include clear instructions on how to seek relief if payment of back premiums creates financial hardship.
10. Enrollment Eligibility for Individuals Not Lawfully Present in the United States (§ 417.2, § 417.420,§ 417.422, § 417.460, § 422.1, § 422.50, § 422.74, § 423.1, § 423.30, and § 423.44)
We ask CMS to clarify the language in the proposed rule at p. 1931 regarding Medicare eligibility for qualified aliens. The current proposal improperly states that “aliens who are not qualified aliens are ineligible for federal public benefits.” Although this is generally true, this is not the rule for Medicare. Individuals who earn sufficient work history to qualify for Social Security benefits may be eligible for Medicare as well, if they are lawfully present aliens in the U.S for a period of five years. The broader term “lawfully present” for this purpose includes “qualified” immigrants as well as several other categories of non-citizens. 8 C.F.R. § 1.3.
Lawful presence for the purposes of Medicare eligibility is defined at 8 U.S.C. §1641(b) and 8 C.F.R § 1.3. A qualified alien is but one category of lawfully present individuals, and Medicare eligibility including eligibility for the MA program, Part D and Cost Plans cannot be restricted to only qualified aliens.
We suggest that CMS codify in regulation required notice and appeal rights for individuals disenrolled from their Part D or MA plan based on absence of lawful presence. Notice should include clear information on why the individual is being disenrolled and should explain what disenrollment into traditional Medicare will mean. In particular, CMS should make clear that an individual may remain enrolled in traditional Medicare if they pay premiums, but will not be eligible to have claims paid on their behalf for as long as they lack lawfully present status. Furthermore, beneficiaries should be entitled to appeal their disenrollment through the process set out in 42 U.S.C § § 1395ff et seq. and 42 C.F.R.§§ 405.904 et seq.
Additionally, we ask CMS to put in place a Special Enrollment Period (SEP) for individuals who are dis-enrolled from their MA or Part D plan based on lack of lawful presence, but who later regain lawful presence status and wish to re-enroll in Part D or MA. Individuals who are disenrolled from Part D based on lawful presence requirements but remain eligible for Medicare should also be exempt from a Part D premium penalty should they later regain lawful presence status and choose to enroll in a Part D plan.
We urge CMS to make clear that under no circumstances should an MA or Part D plan sponsor be empowered to request proof of lawful presence form an enrollee. Information on lawful presence must be transmitted from the Social Security Administration (SSA) and CMS to Part D plans, and MA and Part D plans should be prohibited from seeking this information directly from enrollees.
11. Part D Notice of Changes (§423.128(g))
CMS proposes to codify existing requirements that Part D plan sponsors make an Annual Notice of Change (ANOC) available to beneficiaries 15 days prior to the Medicare Annual Coordinated Election Period (ACEP), thus aligning Part D requirements with MA rules. While many Part D plans already provide this notice, as required through CMS guidance, we believe it is important that this requirement is made explicit through the rulemaking process.
Requiring an ANOC of Part D plans ahead of open enrollment serves the dual purpose of reminding beneficiaries to revisit their prescription drug coverage options annually, while also providing a summary of changes to a plan’s coverage and cost sharing for the following year. Access to this information ahead of open enrollment is critical given that annual changes to premiums, cost sharing, utilization tools, and benefits are commonplace. Additionally, CMS appropriately emphasizes that PDPs must clearly communicate cost sharing changes, in addition to formulary changes, through the ANOC.
12. Separating the Annual Notice of Change (ANOC) from the Evidence of Coverage (EOC) (§422.111(a)(3) and §423.128(a)(3))
CMS proposes to require that MA plans send the ANOC separate from the Evidence of Coverage (EOC). The EOC is a long and detailed document. We often observe that beneficiaries find reviewing the EOC a daunting experience. In fact, we find that many beneficiaries require assistance from a trained counselor to decipher the EOC’s content. By contrast, the ANOC is a streamlined tool designed to help beneficiaries determine whether to switch to another MA plan or to traditional Medicare during the annual enrollment period. As such, we support CMS’ recommendation to separate the delivery of the ANOC and the EOC.
We continue to believe that individually tailored ANOCs would be most helpful to beneficiaries as a decision-making tool. We encourage CMS to consider opportunities to tailor these notices to individual needs. Along these lines, we applaud improvements to the ANOC for MA plans in the “Advance Notice of Methodological Changes for Calendar Year (CY) 2015 for Medicare Advantage (MA) Capitation Rates, Part C and Part D Payment Policies and 2015 Call Letter.” These improvements strengthen requirements regarding plan notification about provider network changes.
13. Agent/Broker Compensation Requirements (§ 422.2274 and § 423.2274)
While we appreciate efforts by CMS to simplify the calculation of agent compensation and reduce incentives for agents to move customers to plans with greater agent compensation, we are skeptical that such changes will accomplish that goal. CMS proposes to tie the renewal compensation structure to a maximum of 35% of the fair market value (FMV) in the current year and eliminate the distinction between different types of plans for the purposes of renewal compensation payment. While we are not opposed to the simplification of calculating agent compensation, variations in the amounts organization are willing to pay are likely to continue and remain a factor in replacement decisions by agents and brokers. As CMS points out, even small differences in compensation can become significant when applied to a small number of enrollees.
To neutralize the incentives created through compensation and reduce the likelihood of inappropriate replacement we think a mandatory suitability form should be required. We suggest CMS develop a replacement document (or form) that requires an agent to make a comparison of the differences between an existing plan and a replacement plan, identify the reasons for replacement, and attest to the accuracy of that comparison to ensure the suitability of replacement coverage. Such a suitability form should be required as part of the application. The parent organization should be required to retain it and make it available to CMS for audit purposes, to departments of insurance during a market conduct exam, or for examination in the case of a disputed replacement. We think this kind of documentation would be effective tool to ensure that appropriate coverage is sold and that the replacement coverage is in fact the best coverage to meet the health care needs of the applicants.
In addition we have become aware of other actions affecting compensation that lead to plan replacement. Parent organizations that slow down, artificially delay, or dispute payment of compensation encourage agents and brokers to take their business to another parent organization. We think this is an issue that deserves attention from CMS in its review and audit procedures of MA and PDP organizations.
We are also concerned about referral or “finder” fees. We think this is an area that leads to abuse. Marketers and lead generation companies “data mine” every conceivable source to “inform” Medicare beneficiaries about their choices. The frenzy to find beneficiaries and sell them coverage should not be rewarded separately from the compensation for taking and submitting an application for coverage. We encourage CMS to ban this practice, or in the alternative, set a low dollar limit on this questionable practice.
14. Drug Categories or Classes of Clinical Concern and Exceptions (§ 423.120(b)(2)(v) and (vi))
In this portion of the proposed rule, CMS would replace the requirement that all Part D plans cover all available medications in six designated protected classes with a “two-pronged criteria” to determine which categories of medications are of sufficient clinical concern to merit continued protected access. We are deeply concerned about this change and urge CMS to revisit this analysis.
CMS cites rising program costs and patient protection concerns as the primary justifications for altering its protected class policy. As applied, the proposed two-pronged criteria would result in the elimination of the antidepressant and immunosuppressant drug classes from the list of classes of clinical concern effective in 2015. CMS also proposes to remove the antipsychotic drug class from the list of protected classes, deferring any change to 2016 to allow the agency to continue its evaluation of the need for additional considerations regarding transitions for individuals already taking these medications.
The proposed rule relies too heavily on the appropriate functioning of beneficiary protections, including formulary transparency, formulary requirements, reassignment formulary coverage notices, transition supplies and notices, and the coverage determination and appeals processes, to justify easing robust formulary requirements for protected drug classes. Our experience serving Medicare beneficiaries suggests that these protections are insufficient, which we explain in more detail below. In particular, we continue to suggest that CMS examine and streamline the Part D appeals system. We believe increased transparency about how well the appeals system operates is needed.
We find that multiple statements in the proposed rule about the effectiveness of current beneficiary protections are not reflective of the experience of the beneficiaries with we work. We remain unconvinced that the proposed two-pronged test is adequate. In addition, with respect to antipsychotic prescribing practices in long-term care settings, we believe that CMS can implement more appropriate controls to ensure these medicines are prescribed appropriately without scaling back open formulary access. Given our concerns about the lack of beneficiary protections, we cannot support the proposed changes to the protected classes at this time.
The Part D appeals process needs significant repair.
Denials of coverage and subsequent appeals remain a constant barrier facing Medicare beneficiaries we assist. The Part D appeals process is particularly confusing for individuals and is difficult to navigate. Recent findings by MedPAC confirm that many beneficiaries are unaware that they have the right to appeal and do not know how to go about initiating the appeals process.[2
As noted in the proposed rule, plans are “are required to issue a coverage determination . . . in accordance with strict regulatory timeframes.” That requirement is only triggered by a request for a coverage determination, accompanied by a letter of physician support if the request is for a formulary exception. Plans are not required to “treat every claim transaction as [a request for a] coverage determination.” As such, beneficiaries who present a paper prescription or an e-prescription and denied prescribed drugs at the point-of-sale receive only a generic notice about appeal rights, not an individualized decision.
As a result, we find that people with Medicare are not adequately informed about their options when denied a medication at the pharmacy counter. As such, beneficiaries must embark on a tedious, fact-finding search to learn the reason for the refusal and then determine the best path forward. Pharmacists may have limited or incomplete information and can only direct a beneficiary to call their drug plan for the denial reason. Beneficiaries often face long call wait times and inconsistent customer service when trying to obtain this information.
Nor, once someone discovers how to request a coverage determination, is the appeals process timely and efficiently managed. We observe that the multi-step Part D exceptions and appeals process proves onerous and time-consuming for beneficiaries, pharmacists and prescribing physicians. Although denied coverage at the pharmacy counter, this refusal does not constitute a formal denial by the prescription drug plan, entitling the person to an appeal. Instead, with the support of the prescribing physician, a beneficiary must formally make an exception request. Only upon receipt of a written denial in response to this request, known as the coverage determination, is the beneficiary permitted to request a formal appeal, termed a redetermination.
It is important to note that this course of action may involve multiple phone calls and long wait times, often up to many days, for beneficiaries seeking access to a needed medication. A person must correspond with both their plan and their prescribing doctor on multiple occasions to see the coverage determination and redetermination phases through.
These delays highlight the fact that the seven-day standard in the first prong of the proposed two-prong test is partly based on the timeline by which a person would have a decision from the Independent Review Entity (IRE) if they received expedited treatment for their appeal. Given our experience working alongside beneficiaries through the appeals process, we do not believe this timeline is sufficient. We continue to urge CMS to streamline the appeals process, and to modify the proposed two-pronged test to reflect the realities of the appeals process in determining which classes of drugs require clinical concern status.
To date, there is no data or analyses available to the public or reflected in the proposed rule to suggest how often improper denials are corrected at the plan level. Further, what appeals data exists is not reassuring. CMS’ 2012 audit suggests that Part D plans struggle most with managing coverage determinations, appeals and grievances. Additionally, 2011 data released by the agency finds that over half (54%) of plan-level denials are overturned by the IRE, which conducts the first post-plan level review.
This alarming rate of reversals by the IRE, coupled with the agency’s own audit data, raises serious questions about how well the redetermination and appeals process is working, and demands greater transparency. We urge CMS to make plan-level appeals data accessible in easy-to comprehend formats so that targets for improvement can be identified. More importantly, we strongly believe that the Part D appeals process must be improved and tested ahead of any changes that would relax the protected classes standards. A straightforward approach to streamlining the appeals system would combine the POS refusal with the formal request for a coverage determination.
Allowing the pharmacy counter refusal to serve as the coverage determination serves the dual purpose of removing a burdensome step for beneficiaries and their doctors by explicitly stating why the drug is not covered while also expediting the appeals process for those who need it.
Formulary review and transparency need improvement.
We believe that CMS sets an unreasonably low bar for evaluating beneficiaries’ formulary needs. In the proposed rule, CMS writes, “…with our more than 7 years of experience with the Part D program, we are not aware of any Part D drug that is not included on at least one Part D formulary. Thus, beneficiaries who review plan formularies [on Plan Finder] can select plans that cover all of their current medications.” This statement is highly problematic as justification for reducing formulary protections for two key reasons:
First, it is inconsistent with our experience helping beneficiaries review their coverage options. While it may be accurate that there is no Part D drug that is not on at least one formulary, the same plan options are not available in all areas of the country, and beneficiaries must select a Part D plan within their geographic area. Furthermore, many beneficiaries, particularly those with complicated health status, take more than one prescription. The fact that drug A is on the formulary of Plan X and drug B is on the formulary of Plan Y is not sufficient for a person who must take both A and B.
Second, this statement ignores the well-documented shortcomings of the Plan Finder tool. As a recent GAO report found, despite CMS oversight and improvements, beneficiaries still encounter inaccurate and out-of-date information on the Plan Finder. Among recommendations to improve the Plan Finder provided by advocates to CMS are to add appropriate MA plan content, most notably information concerning provider networks, ensure the clarity and accuracy of mail order information, improve the accuracy of cost sharing data, and more.
We believe that CMS should take steps to improve both beneficiary education and the Plan Finder before restricting access to some of the most urgently needed medications. Members of Congress should explore how to make the appropriate resources available to CMS to support making the Plan Finder a more robust and user-friendly tool.
Access to transition fills is inconsistent.
Transition fills, coverage for one month for a continuing treatment when there has been a plan or formulary change, are an essential protection that we find many beneficiaries do not receive. In 2013, CMS continued a transition-fill monitoring program in response to widespread failure to provide appropriate transition refills to those entitled to them. CMS has attempted to address failures to properly effectuate transition fill by drug plans in the past, without improvement. These systematic failures underscore the need for on-formulary access to a wide range of medications for certain classes of drugs.
Uninterrupted treatment on a specific medication is particularly essential for antidepressants, antipsychotics, and immunosuppressants, the very same drugs for which CMS suggests protected status should be relaxed. We applaud CMS for implementing the transition-fill monitoring program. Yet, we believe that CMS should wait for the full results, and publish those results, before relying on transition fills as an appropriate fail-safe for securing access to these essential medications.
In addition to these known shortcomings, transition fills are only available to a narrow band of beneficiaries. Individuals previously stabilized on a particular antidepressant, for example, but who are untreated for a period of time are not eligible for a transition fill if they must return to treatment. In these cases, a beneficiary’s physician likely knows which specific medication is best suited to the person’s health needs. In the absence of broad formulary protections, these beneficiaries may not be able to access the particular medicine essential to their health. The test for classes of clinical concern should reflect the needs of patients like these, or, at minimum, CMS should require Part D plans to provide “transition fills” or some period of coverage, for all medications in the formerly protected classes, regardless of whether the other requirements for transition fills are met.
The stated justifications for the narrowing of these protections are insufficient.
CMS’ rationale for the rule, “that requiring essentially open coverage of certain categories and classes of drugs presents both financial disadvantages and patient welfare concerns for the Part D program as a result of increased drug prices and overutilization” is not sufficiently supported to justify the restrictions on access to needed medicine.
There is no evidence presented that the inclusion of all drugs in these classes results in widespread overutilization of these medications, except for the over prescription of anti-psychotic medications in nursing home settings. We recognize the significant problem of the inappropriate and over-prescription of antipsychotic medication in the inpatient long term care setting, and share CMS’ concern. Below we detail recommendations to curb inappropriate prescribing of antipsychotics in long-term care settings.
Additionally, the evidence used to support the argument that significant cost savings will result is unconvincing, as reflected in a February 5, 2013 letter from the Senate Finance Committee to CMS. We agree that additional research, including analysis of the potentially increased costs related to doctor’s services, emergency room visits, and hospitalizations that might result from decreased access to appropriate medications is needed before CMS relaxes the protected drug classes.
The proposed two-pronged test is too narrow.
The first prong of the test is, as noted above, unrealistic in its use of seven days as an accurate measure for the time that an expedited appeal will be resolved. Beneficiary confusion, prescriber schedules and plan delays all create situations in which a person is without their needed medication for longer than seven days, and this should be reflected in the proposed test. Furthermore, the standard of harm contemplated is too high, and these classes should be assessed based on whether a realistic delay caused by non-formulary status or utilization management tools would harm the health and well-being of the beneficiary.
The second prong of the test is that formulary requirements short of total access to all medicines in the class would not be sufficient because of the diversity of disease manifestations and the specificity or variability of drug therapies within the class. CMS notes that existing formulary requirements would apply to drugs no longer in the protected classes or that CMS would develop more specific formulary requirements for these drugs. It is essential that CMS release any more specific formulary requirements that it contemplates. The background existing requirement that two medications from each class be included, as outlined in the formulary review, is clearly insufficient to protect beneficiary access to these medications.
Exceptions to remaining classes of clinical concern need to be addressed.
CMS identifies several proposed exceptions to drugs with protected class status. Among these, we are supportive of the exception to allow point-of-sale utilization management safety edits based on maximum daily doses and black box warnings, drug interactions or duplication. We think that this exception, if effectively utilized, can serve, in part, to address the stated need for plans to impose utilization management edits on inappropriately prescribed antipsychotics, as these medications carry a “black box warning” against use in individuals with dementia.
We do not, however, support the exception for drugs almost always covered by Part A or Part B of the Medicare program. As noted in section III.C.2, discussed below, Medicare Advantage Prescription Drug (MA-PD) plans do not handle these appeals efficiently or in a way that promotes access to needed medication in a timely manner. Furthermore, as CMS acknowledges, delays in accessing medications, such as injectable anti-cancer medications, potentially subject to prior-authorization requirements under the proposed rule can lead to rapid and life-threatening medical consequences for beneficiaries.
While we appreciate the desire to control costs, we are concerned that encouraging Part D sponsors to use prior-authorization edits for Part A/Part B versus Part D drugs could seriously delay access to needed medications and cause increased confusion. We encourage CMS to eliminate this exception, or to require Part D sponsors (and MA-PDs) to treat any pharmacy refusal resulting from these restrictions as an exception request.
CMS has requested comments on an exception that was “considered” for addition to the proposed rule—to allow Part D sponsors to implement prior authorization or step therapy controls on new prescriptions in the categories of clinical concern. We oppose this exception. In light of the extremely narrow criteria for the categories of clinical concern outlined in this proposed rule, delays in access due to these requirements are unacceptable. Furthermore, as noted above, treatment histories for particularly vulnerable beneficiaries, including those with mental health issues, are often inconsistent and incomplete, and beneficiaries might end and resume treatment without the continuity required to avoid this exception.
Nursing home residents need protection from the inappropriate prescribing of antipsychotic drugs.
Whether or not antipsychotic drugs remain a protected class for Medicare beneficiaries who have a medical need for such drugs is a separate issue from the need to protect nursing home residents from the inappropriate prescribing of antipsychotic drugs. Establishing long overdue protections for residents does not depend on changing the rules for antipsychotic drugs for people for whom they are medically necessary, as CMS implies in the proposed rules.
There is no question that antipsychotic drugs are medically inappropriate for the vast majority of nursing home residents who receive them. The Inspector General conclusively documented in 2011 that hundreds of thousands of residents received antipsychotic drugs and that 83% of the claims were for off-label conditions, including 88% for conditions specified in the black-box warning given to antipsychotic drugs by the Food and Drug Administration (FDA). The American Geriatric Society’s Beers List of drugs that are inappropriate for older people includes antipsychotic drugs. The Senate Special Committee on Aging held a hearing in 2011 on the misuse of antipsychotic drugs in nursing homes, Overprescribed: The Human and Taxpayers’ Costs of Antipsychotics in Nursing Homes (Nov. 30, 2011).
CMS’s current effort to reduce the inappropriate use of antipsychotic drugs – the Partnership to Improve Dementia Care in Nursing Homes – is a failure. In this initiative, CMS set a preliminary goal of reducing antipsychotic drug use for long-stay residents by 15% by the end of calendar year 2012. The 15% reduction would have meant that the rate of antipsychotic drug use would decline from 23.9% of residents nationwide in July 2012 to 20.2% of residents by the end of 2012. That goal has not been met, as of February 26, 2014. The result of the failure of the Partnership is that more than 300,000 nursing home residents continue to receive antipsychotic drugs.
CMS abandoned an earlier effort to address the problem of antipsychotic drugs through revisions to consultant pharmacist rules. The Nursing Home Reform Law’s requirement that nursing homes engage consultant pharmacists to review residents’ drug regimens each month (and to make recommendations to the prescribing physician(s)), 42 C.F.R. §483.60(c), has been undermined by drug companies’ using consultant pharmacists as part of their marketing teams. CMS proposed making consultant pharmacists independent, 76 Fed. Reg. 63017, 63038-63041 (Oct. 11, 2011), but decided not to make the proposed rule final, 77 Fed. Reg. 22071, 2211-22107 (Apr. 12, 2012), despite receiving overwhelming evidence that conflict-of-interest problems are pervasive and serious.
The current regulatory system has also failed to protect residents from inappropriate use of antipsychotic drugs. The Center for Medicare Advocacy and Dean Lerner Consulting completed a study of antipsychotic drug deficiencies cited by seven states in 2011 and 2012. The study found that 95% of the deficiencies were cited at a no-harm level, regardless of how many residents were harmed or how serious the harm. As a consequence of labeling deficiencies as no-harm, however, CMS was unlikely to impose any penalties against the facilities.
CMS is aware of the problem of the pervasive misuse of antipsychotic drugs in nursing homes and already has the tools to address it. CMS expresses concern in the proposed rule that the use of antipsychotic drugs for nursing home residents “is, in many cases, unwarranted and in others, possibly dangerous.” CMS also recognizes in the proposed rule that “Coverage under Part D is not available for drugs that are not used for a medically-accepted indication” and that “Prior authorization requirements to determine medically-accepted indications should be limited to those drugs for which it is reasonably foreseeable that use for non-medically-accepted indications are likely to occur.” CMS must apply its knowledge and these principles to protect residents.
We urge that Part D rules be amended to
- Require plans to implement prior authorization rules for antipsychotic drugs for nursing home residents. Plans know which plan participants are in nursing homes.
- Require plans to implement medication therapy management for all nursing home residents who receive antipsychotic drugs.
15. Medication Therapy Management Program (MTM) under Part D (§ 423.153(d))
We share the concerns of CMS that Medicare MTM programs are not living up to desired expectations. It remains difficult to gauge the relative success of MTM programs, given the lower than expected enrollment and limited evidence of the program’s efficacy. Although we question whether broad expansion is the best way to enhance the effectiveness of MTM programs, we appreciate that uniformity across plans is needed to facilitate research on program efficacy, best practices and potential enhancements and endorse the more precise rules being proposed by CMS. Further, we share the agency’s concerns about the effectiveness of plans in reaching the individuals who could most benefit from MTM. The studies cited by CMS concerning racial and ethnic disparities in access to MTM are particularly concerning.
We believe that the proposal in the NPRM which requires offering MTM to individuals with two chronic conditions, who are using at least two Part D prescription drugs, and whose spending meets a cost threshold based on the cost of two generic drugs is a reasonable one and we endorse its adoption. The reasons enunciated by CMS are compelling and uniform requirements will help ensure that beneficiaries have similar access to MTM across plans.
We also strongly endorse CMS’s proposal to require that plans “have an outreach strategy designed to effectively engage all at-risk beneficiaries enrolled in the plan.” We agree that outreach through pharmacies where individuals fill their prescription is one good approach to finding and engaging hard-to-reach beneficiaries. Plans also have access to the identities of prescribing physicians and could use that information as well, particularly if a physician or group practice primarily serves an LEP population.
We further ask that CMS closely and specifically monitor MTM enrollment by minority populations, LEP beneficiaries and other hard-to-reach subgroups. Plans should be held responsible both for their outreach to these groups and for their effectiveness in delivering MTM benefits, including Comprehensive Medication Reviews (CMRs), to enrolled individuals.
Finally, we wish to respond to the invitation in the NPRM to suggest additional approaches for MTM outreach to hard-to-reach populations. We believe that one important piece of the puzzle is expansion of language access rules for plans, specifically an expansion of the categories of documents subject to the requirement for translation and for multi-language inserts.
The NPRM touches briefly on translation requirements, stating that “translators and multi-language inserts currently required may not be adequate to address the cumulative effects of race and ethnicity, lower levels of education, and poverty that are frequently associated with individuals with limited English proficiency.” We agree that a multi-faceted, culturally competent approach is required and that translation of documents is only one piece of that approach—but it is a very important and foundational piece. Translation also is a piece that is currently missing in connection with MTM notices and many other notices (appeal notices, disenrollment notices, etc.) that are critical for beneficiaries to understand how to access services.
Currently, the Medicare language access regulations governing written communication, 42 CFR 423. 2264 for Part D and 422.2264 for Part C, only apply to a narrowly defined set of marketing documents. Plans are not required to translate any other important documents or notices into other languages or to include multilingual inserts with any non-marketing mailings. CMS should expand its requirements for translations and inserts to encompass a much broader range of beneficiary communications, including communications about MTM enrollment. Since communications about MTM affect access to services that, as CMS has noted, are an important part of the Part D benefit, these communications should be treated as “vital” documents under Title VI of the Civil Rights Act of 1964 and should be subject to a requirement for written translation and inserts. Plans can and should start with translated notices and inserts and build on this baseline to reach out to LEP beneficiaries.
16. Business Continuity for MA Organizations and PDP Sponsors (§422.504(o) and §423.505(p))
We support the proposed requirements that plans sponsors have plans for unavoidable interruptions, and to anticipate disruptions that could occur and reduce interference with beneficiary access. CMS highlights the experience of beneficiaries affected by Hurricane Sandy as the basis for new planning and service continuity requirements. We are aware that a number of beneficiaries were unable to secure needed prescriptions and other services in the aftermath of Hurricane Sandy. As such, we strongly support CMS’ determination that these continuity plans should be developed and tested to ensure that beneficiary needs are met.
17. Requirements for Applicants or Their Contracted First Tier, Downstream, or Related Entities To Have Experience in the Part D Program Providing Key Part D Functions
We support the development of requirements for first-time applications to the Part D program. Under the proposed rule, plan sponsors or related entities must have at least one year of experience delivering the Part D benefit in order to a secure a Part D contract.
18. Requirements for Applicants for Stand Alone Part D Sponsor Contracts to be Actively Engaged in the Business of the Administration of Health Insurance Benefits (§423.504(b)(9))
We support the proposed minimum experience requirements. This provision would help ensure that plan sponsors entrusted with providing vital prescription drug coverage to enrollees are up to the task and would help minimize harm to beneficiaries. .
19. Limit Parent Organizations to One Prescription Drug Plan (PDP) Sponsor Contract Per PDP Region (§423.503)
We support the proposal not to approve a PDP sponsor application when the applicant is applying for qualification in a PDP region where another subsidiary of the applicant’s parent organization already holds a PDP sponsor contract. We agree such a change would promote the effective administration of the Part D program by addressing the significant inefficiencies of having duplicate contracts that do not provide more benefit plan options than could be offered under a single contract.
Given this, we strongly support CMS’ efforts to prevent anti-competitive “gaming” by requestors of duplicate contracts by segregating low-income beneficiaries into their own contract or segregating low-performing plans into their own contracts so as not to taint the performance rating of better performing plan offerings. We recognize that, as noted by CMS, this proposed limitation is necessary to preserve the integrity and strengthen the transparency of CMS’ star rating assigned at the contract level.
If a parent organization artificially inflates the star ratings on one contract by excluding the poor performance under it other contract, we agree that some beneficiaries could make a plan election without complete information about the performance of the organization ultimately responsible for the quality of services they would receive by enrolling in that plan. We also agree that because there can be more than one plan per sponsor, the program does not need more than one sponsor per parent organization, and encourage CMS’ effort to further consolidate the sponsors it proposes to grandfather under this rule.
20. Limit Stand-Alone Prescription Drug Plan Sponsors to Offering No More Than Two Plans Per PDP Region
CMS proposes to limit the number of prescription drug plans (PDPs) that can be offered by a plan sponsor to one basic and one enhanced plan per region. We continue to support CMS’s efforts to consolidate Part D plan offerings and to require meaningful differences among plans.
Like CMS, we believe that an appropriate offering of plans in a given region must reflect a balance between meeting the needs of diverse beneficiaries and avoiding undue confusion resulting from the availability of too many plans. Based on our experience, the current multitude of plan choices does not adequately strike the desired balance. In 2013, on average, beneficiaries had a choice among 31 PDPs.
We observe that older adults and people with disabilities – as well as family members providing assistance to them – often find choosing among a large number of Part D plans a perplexing experience. We urge people with Part D to revisit their plan’s coverage each year, as annual changes to plan premiums, cost sharing, utilization tools, and formularies are commonplace. Yet, research and our one-on-one counseling of people with Medicare suggest that inertia is widespread.
Most people with Medicare fail to reevaluate their coverage options on an annual basis, largely because there are too many options and too many variables to compare. According to one analysis, from 2006 to 2010, only 13% of beneficiaries switched prescription drug plans during each annual enrollment period, despite changes in premiums, cost sharing, and coverage.
In addition, so-called enhanced Part D plans are not always meaningfully enhanced, and in many cases it would serve beneficiaries better if these plans were consolidated or eliminated. Lower income beneficiaries who are enrolled in the Low-Income Subsidy, or Extra Help, can receive full subsidies for so-called basic plans—but not for enhanced plans. This means that the less robust enhanced plans will tend to attract a wealthier, healthier population, and be able to offer enrollees lower premiums—while basic plans will charge higher premiums to cover the costs of a by and large less affluent and less healthy population.
Additionally, plan sponsors have less competitive incentive to keep basic plan premiums low—premiums which are paid in large part by the federal government through the Extra Help program. This is because plans sponsors are currently able to attract healthier, private-paying individuals to a low-premium enhanced plan. We agree with CMS that this kind of risk segmentation should be avoided.
21. Efficient Dispensing in Long Term Care Facilities and Other Changes (§ 423.154)
We support the proposed regulatory provisions which improve drug dispensing efficiency in long term care facilities while ensuring access to medication for residents. In particular, we strongly support CMS’ decision to hold beneficiaries harmless and require total beneficiary cost sharing under the new rules be no greater than what total cost sharing would have absent implementation of the proposed regulation.
22. Applicable Cost-Sharing for Transition Supplies: Transition Process Under Part D (§ 423.120(b)(3))
We strongly support provisions in the proposed regulation which would make transition supply cost sharing simpler for beneficiaries to understand, and which would ensure that plans assess the appropriate beneficiary cost-sharing amounts at all times, including during transition fills.
25. Pharmacy Price Concessions in Negotiated Prices (§423.100) and
26. Payments to PDP Plan Sponsors for Qualified Prescription Drug Coverage (§423.308) and Payments to Sponsors of Retiree Prescription Drug Plans (§423.882)
In Part III.A, sections 25, 26, 27 and 29, CMS proposes a series of interrelated proposals on negotiated drug prices, preferred cost sharing, and preferred pharmacies. We strongly support this series of proposals, and we believe these changes will benefit both taxpayers and Medicare beneficiaries.
CMS proposes to standardize how Part D plans report the negotiated price for particular medications, which in turn affects the amount CMS pays plan sponsors. To justify this change, CMS details inconsistencies in how plans report negotiated drug prices. For instance, some plans are reporting a negotiated price that includes “concessions” from the network pharmacy, essentially price reductions, while others report a higher negotiated price that excludes concessions, and wait until the payment year reconciliation process to report concessions as one-off discounts. CMS explains that the proposed standardization is needed to ensure that Part D plans cannot game the system by failing to report network pharmacy concessions in the negotiated price.
We support CMS’ efforts to ensure that the reported negotiated price accurately reflects the net agreed-upon price between the network pharmacy and Part D plan. This practice will not only benefit the Medicare program—and taxpayers—but also improve the accuracy of premium and cost amounts in the Medicare Plan Finder, CMS’ online plan comparison tool, allowing beneficiaries to more accurately gauge plan costs and efficiency.
27. Preferred Cost Sharing (§423.100) §423.120)
CMS seeks to address existing problems with “preferred pharmacy” arrangements. We strongly endorse CMS’ plan to codify requirements that preferred pharmacies actually save money for Medicare. When Congress enacted Part D it sought to preserve patient access and choice by permitting any willing pharmacy to participate in a network so long as it met the plan’s reasonable terms and conditions. In recent years, however, some plan sponsors have formed preferred pharmacy arrangements that are increasingly restrictive and not cost effective. As CMS explains in the proposed rule, the utilization of preferred cost sharing by plan sponsors should reflect a lower total cost for prescriptions to Medicare and to beneficiaries. Currently, however, the promise of savings is not being fully realized.
Numerous CMS studies have found that current sponsors who utilize preferred pharmacy networks, “…have actually offered little or no savings in aggregate in their preferred pharmacy pricing, particularly in mail-order claims for generic drugs…” CMS also found that numerous plan sponsors, and their Pharmacy Benefit Manager (PBM) intermediaries, have conflicts of interest with respect to these pharmacy arrangements. CMS writes, "…we note that most PBMs own their mail order pharmacies, and we believe their business strategy is to move as much volume as possible to these related-party pharmacies to maximize profits.”
In this way, plans distort market behavior by lowering beneficiary cost sharing where the full cost of the drug is the same or higher than it would be at a non-preferred pharmacy. Instead of harnessing the power of consumer choice to lower costs overall by aligning lower cost-sharing with lower total cost, the plans divide the interests of individual beneficiaries and the Medicare program in order to increase the profits of related-entity mail order pharmacies. This results in higher Medicare spending overall.
Like CMS, we find these facts disturbing, and we agree that these practices reflect inappropriate cost shifting to CMS and taxpayers. As such, we strongly endorse CMS’ proposal to revisit the current preferred pharmacy network structure in favor of a minimum savings standard under a preferred cost sharing system.
We also support CMS’ proposed language change to more accurately reflect that preferred cost sharing is applicable to a particular medication at a particular pharmacy, and to avoid confusion about whether non-preferred pharmacies are out-of-network. Understanding how preferred, in-network pricing works is one of the most opaque and confusing aspects of choosing a Part D plan.
In our experience, beneficiaries often find the distinction between in-network and out-of-network status difficult to grasp. Preferred and non-preferred status, essentially networks within networks, creates yet another layer that beneficiaries must understand when using their Part D benefits. Given this, we support these efforts by CMS to ensure that plan pricing and cost sharing structures are uniformly explained across plans.
28. Prescription Drug Pricing Standards and Maximum Allowable Cost (§423.505(b)(21))
We appreciate that CMS is proposing greater transparency in pricing between plans and pharmacies. While we expect that large pharmacy chains are able to use their considerable resources to ensure that they are treated correctly by plan sponsors, we expect that the burdens of an opaque system fall more heavily on smaller rural and community pharmacies on which many beneficiaries depend. The uncertainties of an opaque system may lead pharmacies to choose not to participate in a plan’s network, thus limiting beneficiary access. The proposed changes should help alleviate this problem.
29. Any Willing Pharmacy Standard Terms & Conditions (§423.120(a)(8))
Aligned with the proposal to ensure that preferred cost sharing signals consistently lower costs, CMS proposes that any pharmacy willing to meet specified savings goals be allowed to charge preferred cost sharing. We agree that local pharmacies willing to match competitors’ prices should be allowed to charge the applicable cost sharing. We endorse the proposed changes applying the “any willing pharmacy” standard to preferred networks as a way of increasing beneficiary access and reducing beneficiary costs.
We also strongly endorse the requirement that pharmacies in a preferred network must consistently charge preferred cost sharing and consistently bill no more than the ceiling price for all prescriptions. Beneficiaries have the right to a system that is predictable and understandable.
30. Enrollment Requirements for the Prescribers of Part D Covered Drugs (§ 423.120(c)(5) and (6))
We support CMS’s efforts to curb improper prescribing practices and patterns, to reduce fraud, waste, and abuse by targeting those most likely to be acting inappropriately. We applaud narrowly focused efforts that target problematic providers without imposing burdensome, expensive, and ineffective restrictions on beneficiary access to care.
In particular, we support the requirement that prescribing providers have a Drug Enforcement Administration (DEA) certificate and state prescribing authority to participate in the Medicare program. We also support the standards for continued participation in the Medicare program, and the ability of CMS to revoke participation for abusive behavior that threatens the health and safety of Medicare beneficiaries.
We support, with some reservation, the requirement that prescribing physicians have appropriate enrollment or opt-out status with traditional Medicare. Although we appreciate the increased oversight and credentialing that this requirement affords, we encourage CMS to include beneficiary protections to avoid unintended adverse affects, including holding beneficiaries harmless from the consequences of non-coverage for a non-compliant provider for at least one fill of the prescription. Plans should also be required to educate beneficiaries about this issue and allow sufficient time for the beneficiary to seek another provider or for the provider to correct their enrollment status.
Second, exceptions should be made for those providers who do not normally see Medicare beneficiaries or receive Medicare payment, including dentists and Veteran’s Administration doctors. These providers should be able to, after a grace period, register with Medicare in a limited capacity to enable them to write prescriptions for Medicare beneficiaries. We also encourage CMS to reach out to policy makers in the states that permit foreign prescriptions, to determine what kind of alternate provider credential checking might be available to ensure that beneficiaries who spend portions of the year in other countries can access their medications without interruption or the unneeded expense of additional physician visits.
Finally, we strongly believe opt-out physicians and eligible professionals should be considered covered under the Part D program as long as the opt-out physician or eligible professional furnishes their NPI to an A/B MAC. Psychiatrists are the providers with the highest rates of opt-out from the Medicare program. Medicare beneficiaries with serious mental illness and other disorders should be allowed to continue to see their opt-out psychiatrist while maintaining access to critical psychiatric medications through their Part D plan.
32. Transfer of TROOP Between PDP Sponsors Due to Enrollment Changes During the Coverage Year (§ 423.464)
We strongly support provisions for real-time data transfer between Part D and MA plans for a seamless beneficiary experience. Provisions to ensure that beneficiaries pay the appropriate cost sharing at all times, particularly when switching plans mid-year are especially important to low-income individuals not enrolled in Extra Help and those beneficiaries who take multiple prescription medications.
34. Establish Authority to Directly Request Information From First Tier, Downstream and Related Entities (§ 422.504(i)(2)(i) and § 423.505(i)(2)(i))
We support CMS’ ability to effectively review and evaluate Part C and D through better access to information from FDRs. Ferreting out fraud, waste and abuse is of paramount importance and we support CMS measures to ensure that all those in the supply chain for Part C and D are open to swift information recovery for review and audit.
35. Eligibility of Enrollment for Incarcerated Individuals (§ 417.1, § 417.460, § 422.74, and § 423.44)
We appreciate the CMS clarification that individuals released from incarceration can use the special enrollment period for changes in residence in order to enroll in a plan. Continuity of medical care is an important need for these individuals as they return to the community.
Although beyond the scope of this rulemaking, we ask CMS to also revisit other Medicare provisions affecting incarcerated beneficiaries. As CMS is aware, most Medicare-eligible prison inmates are destitute and unable to pay their Part B premiums during their incarceration. Upon release, they do not have any special enrollment period to join Part B, which can result in significant gaps in coverage. Moreover, they are subject to late enrollment penalties. With the number of elderly prisoners soaring, many states are considering release programs targeting this high cost low-risk group. We ask that CMS undertake a comprehensive review of changes that could be undertaken in order to ease the transition as these beneficiaries leave incarceration and to ensure their access to benefits as they seek to reenter the community.
36. Reward and Incentive Program Regulations for Part C Enrollees (§422.152)
We suggest that CMS move cautiously in exploring how to expand wellness programs and are firmly opposed to any wellness program that “incentivizes” participants through a penalty such as higher cost-sharing. As CMS moves forward with this initiative, it should be noted that while rewards and incentives have been shown to increase participation in wellness programs, there is less evidence showing that rewards or penalties actually lead to meaningful changes in health behaviors and outcomes. Furthermore, there is currently no scholarly research that has examined the effectiveness of wellness rewards or incentives that specifically raise or lower individuals’ health care costs.
Additionally, outcomes-based reward/penalty programs can disproportionately penalize groups like the elderly and people with disabilities who often already face additional barriers to maintaining their health and obtaining health care services. Furthermore, racial and ethnic minorities are more likely to suffer from hypertension, obesity, and other health problems for which they may be penalized under wellness programs that use outcomes-based rewards or penalties. Low-income individuals who struggle to afford health care may also face greater barriers to many of the other resources that are necessary to improve health and achieve wellness goals. Even if a wellness program provides participants with wellness activities, rewards or penalties can unfairly harm lower-income individuals who may face unique barriers to participation in those activities.
We share CMS’ concern that health-driven rewards and incentives programs may be targeted only to healthy enrollees and that sicker enrollees could be discouraged from participating. If MA plans are allowed to offer such programs, we strongly agree with CMS that reward-eligible activities be designed so that all enrollees are able to earn rewards without discrimination based on race, gender, chronic disease, institutionalization, frailty, health status or other impairments. We also agree with CMS that if such programs are offered, MA organizations must provide information about the effectiveness of such program to CMS (instead of “on request”, though, such information should be regularly reported by plans.)
38. Authorization of Expansion of Automatic or Passive Enrollment Non-Renewing Dual Eligible SNPs (D-SNPs) to Another D-SNP to Support Alignment Procedures (§ 422.60)
We do not believe that the proposal in the NPRM to passively enroll members of a non-renewing D-SNP into another D-SNP is in the best interest of the beneficiary. Instead we support the current process of returning the individual into traditional Medicare. traditional Medicare guarantees access to any Medicare provider, and it does not require the beneficiary to make any changes, something that cannot be guaranteed even with another D-SNP with a “similar” network. The beneficiary continues to have the choice of enrolling in another D-SNP, including a D-SNP aligned with the individual’s Medicare Managed Care Organization (MCO).
We also note that demonstrations in several states are testing passive enrollment into managed care plans for dually eligible beneficiaries. Those demonstrations are expected to provide valuable information on how passive enrollment impacts beneficiaries. We have strong reservations about passive enrollment as a practice, and we urge CMS to wait for the demonstration results before deciding on any further expansion of passive enrollment.
Should CMS decide to allow passive enrollment as proposed, it is important that the agency place strong continuity of care requirements on the D-SNP into which individuals are passively enrolled. There should be at least a six-month transition period in which beneficiaries can use non-network providers that were a part of their non-renewing D-SNP network.
Additionally, notices in these circumstances need to be very clear and specific. These notices should include individualized information, based on claims data, about altered drug coverage as well as information on whether a beneficiary’s primary care physician and others providers are the plan’s network. They also need clear guidance about their continuity of care rights. We also ask that CMS work closely with State Health Insurance Programs (SHIPs) to provide individualized counseling to members of a non-renewing D-SNP. CMS should also impose specific outreach responsibilities on receiving D-SNPs and closely monitor beneficiary transitions to new plans.
C. Strengthening Beneficiary Protections
1. Providing High Quality Health Care
We support the inclusion of the explicit requirement that plans take quantifiable steps to improve all five categories identified in CMS’ Star Ratings Program into plan contracts. Moreover, we particularly agree that MA organizations and Part D sponsors should take steps to improve or maintain three of the five categories: process, patient experience, and patient access to care.
2. MA-PD Coordination Requirements for Drugs Covered Under Parts A, B, and D
Our experience serving beneficiaries reflects the same concern raised here by CMS, that beneficiary access to needed drugs is impeded when an MA-PD does not properly adjudicate claims that may be covered under Part A or Part B, rather than Part D, at the point of sale. When this happens, serious and rapid medical consequences can result. We appreciate and support CMS’ proposal to require MA-PDs to actively work with network pharmacies so that coverage an MA-PD denies under Part D can be authorized immediately at the point of sale under Part A or Part B.
Requiring MA-PDs to issue a coverage determination and authorize or provide benefits under Part A or Part B, or under Part D when a party requests a coverage determination, is superior to the current situation where beneficiaries often have to determine which part they ought to be appealing to. Beneficiaries should not have to be well versed in the admittedly complicated and unclear rules surrounding coverage of medications under various parts in order to access their needed and covered medicines.
The rule could be improved, however, by additionally streamlining the process for beneficiaries. As noted above, we have previously urged CMS to require MA organizations and Part D sponsors to treat the presentation of a prescription at the pharmacy counter as a request for a coverage determination, and the response from the plan as an initial coverage determination, giving the beneficiary access to the appeals process. While we continue to encourage CMS to adopt this policy for all pharmacy rejections, it is especially important for rejections for coverage under Part D when coverage may be available under Part A or Part B under the same Medicare Advantage entity to be treated as a request for a coverage determination to avoid delays in access.
Adopting proposed 422.122(b)(7) without the clause “when a party requests a coverage determination” would make the proposed regulation more effective by requiring MA-PDs to actively coordinate coverage under Part A or Part B with coverage under Part D, ensuring beneficiaries’ timely receipt of needed drugs. This change is consistent with CMS’ acknowledgement that coverage rejected under Part D, but available under Part A or Part B, should be made available to beneficiaries as expeditiously as the beneficiary’s medical condition requires.
While we appreciate the statement in the discussion that CMS expects MA-PDs rejecting claims at the pharmacy to establish adequate messaging and processing requirements with network pharmacies to determine if the rejected medication may be authorized under Part A or Part B, or under Part D, we urge CMS to codify this requirement in proposed 422.122. Furthermore, CMS expand this requirement to non-network pharmacies.
3. Good Cause Processes (§§417.460, 422.74 and 423.44)
We appreciate that CMS is contemplating options to further improve and streamline the good cause review process relating to involuntary disenrollment from MA and Part D plans. As noted by advocates in comments to the draft 2014 Call Letter, however, we are concerned about expanding Part C and D plans’ role in the process to evaluate good cause for delays in payment of premiums. We believe the regulations should not be revised to allow CMS to permit an entity acting on behalf of CMS – including the plans or an independent contractor – to complete portions or all of the good cause process, including effectuating reinstatements. Good cause review process should remain within the purview of CMS and outside the purview of a plan or independent contractor.
As beneficiary advocates we continue to hear from MA and Part D enrollees about their plans’ failure to adequately distinguish between appeals and grievances, and to adhere to applicable appeal timeframes. Adding an additional type of review to be conducted or facilitated by a plan might diminish a plan’s ability to perform its current obligations in the appeals and grievances processes. In addition, we are concerned that in a good cause review process, a plan’s primary incentive would be to collect outstanding premium payment rather than ensuring an individual is provided with accurate information about the process, encouraged to gather supporting evidence substantiating a good cause argument, and shepherded through a timely review process. We agree with CMS that ensuring objectivity in the review of these cases and equity among beneficiaries is critically important
We also have concerns about designating independent contractors to complete the good cause process based upon our clients’ experiences with current Medicare contractors tasked with processing claims and appeals. In short, Medicare beneficiaries often experience difficulty reaching or communicating with contractors, and initial denials by Medicare or MA or Part D plans are routinely rubber-stamped by such contractors despite available evidence in support of a beneficiary’s given cause.
4. Definition of Organization Determination (§ 422.566)
While we appreciate CMS’ attempt to clarify the definition of MA plan organization determinations, we strongly believe that any decision on behalf of an MA provider to either furnish or refuse to furnish an item or service be considered an organization determination rather than a treatment decision and thus constitute official notice for the purposes of appeal.
The difference between a treatment decision and an organization determination and the rights that flow from either are completely lost on beneficiaries. Most beneficiaries are not aware that when their provider refuses to furnish an item or service (usually for the reason that the provider believes the plan will not pay) this does not constitute official notice for the purposes of triggering appeal rights. As a result, many beneficiaries simply go without care rather than seeking an official organization determination from their plan.
As in original Medicare, we believe that when a provider chooses not to furnish an item or service because he or she believes Medicare will not pay for that item or service, that an official notice—in this case, an organization determination—be furnished to the beneficiary with details on how to appeal that decision to the QIO.
We support the proposed revision to the regulatory text at § 422.566(b)(6) that would clarify that an item or service provided by a noncontract provider due to a referral from a contract provider constitutes a favorable organization determination and that a beneficiary cannot therefore be held financially liable. We believe this appropriately recognizes a beneficiary’s reliance on their physician referrals, and that if they are referred by an in-network doctor and receive treatment they should not then be held liable for care received that they believed, in good faith, was covered by their plan based on the behavior of an in-network physician.
5. MA Organization Extension of Adjudication Timeframes for Organization Determinations and Reconsiderations (§ 422.568, § 422.572, § 422.590, § 422.618, and 422.619)
We strongly support CMS efforts to crack down on inappropriate plan delays of organization determinations and reconsiderations. In many cases, plan delays in making organization determinations and reconsiderations adversely impact beneficiary access to needed care and dissuade enrollees from exercising appeal rights. We likewise appreciate the inclusion of language clarifying that extensions due to extraordinary, exigent or other non-routine circumstances be exercised only if they are in the enrollee’s interest and similar language strengthening beneficiary protections when they are in the MA appeals process.
D. Strengthening Our Ability to Distinguish Stronger Applicants for Part C and D Program Participants and To Remove Consistently Poor Performers
1. Two- Year Prohibition When Organizations Terminate Their Contracts (§ 422.502, § 422.503, § 422.506, § 422.508, and § 422.512)
We support CMS’ reading of the 2-year prohibition rule to voluntary non-renewals and mutual terminations. We support the agency in its efforts to ensure poor performing MA organization not re-enter the marketplace.
2. Withdrawal of Stand-Alone Prescription Drug Plan Bid Prior to Contract Execution (§ 423.503)
We support the imposition of a 2-year application ban on plans that disrupt CMS’ administration of the Part D program by withdrawn applications and bids after approval from CMS has been issued upon learning of the LIS benchmark. As noted in the regulation, plan withdrawals this late in the process disrupt important preparations including those related to the dissemination of Part D plan information to beneficiaries and LIS auto assignment. Furthermore, we support CMS efforts to cut down on plan gaming of the bid review and auto assignment processes.
3. Essential Operations Test Requirement for Part D
We generally support enhanced oversight of Part D plans including through the imposition of an essential operations test.
4. Termination of the Contracts of Medicare Advantage Organizations Offering Part D for Failure for 3 Consecutive Years to Achieve 3 Stars on Both C and Part D Summary Star Ratings in the Same Contract Year (§ 422.510)
We agree with CMS that the change in LPI methodology likewise requires a change in the contract termination standards and strongly support CMS’ decision to revise the regulations to allow for the termination of a plan based on the totality of its obligations under its Medicare contract. We further applaud CMS for the closing of this “loophole” that allowed low performing plans to remain in the marketplace.
E. Implementing Other Technical Changes (79 Fed. Reg. 2018)
1. Requirements for Urgently Needed Services (§ 422.113)
We support CMS’ redefinition of urgently needed services. In our experience counseling beneficiaries, we likewise note that there are circumstances in which a beneficiary requires non-emergency, urgent medical care that does not strictly conform to the definition of “extraordinary and unusual.” MA plans can and should contract with urgent care providers to ensure beneficiary access to services in a variety of circumstances when they are unable to see a traditional in-network provider. We support CMS in its efforts to ensure MA enrollees have access to urgently needed care in all medically appropriate circumstances.
2. Skilled Nursing Facility Stays (§422.101 and §422.102)
We appreciate CMS’ efforts to protect beneficiaries who change from MA coverage to traditional Medicare during a SNF stay that is not preceded by a three-day hospital stay. Ensuring that such stays will continue to be covered by Medicare even if the individual is no longer enrolled in the MA plan will help individuals who relied on the SNF stay being covered while in the MA plan but for whatever reason disenroll from the plan (or the plan is terminated or non-renewed) during a SNF stay. This is also consistent with the goal of providing uniform Medicare coverage to someone who exercises their rights during an Open Enrollment Period for Institutionalized Individuals (OEPI), per §30.3, Chapter 2 of the Medicare Managed Care Manual (CMS Pub. 100-16).
We appreciate the opportunity to submit these comments.
David A. Lipschutz Andrea Callow
Policy Attorney Policy Attorney
For additional information, please contact David Lipschutz, Policy Attorney, email@example.com, at 202-293-5760.
 Sokolovsky, J., Shinobu, S. and L. Metayer, “Part D exceptions and appeals,” (Presentation to MedPAC: September 2013), available at: http://www.medpac.gov/transcripts/part%20d%20exceptions%20&%20appeals.pdf.
 Proposed rule at 1940.